Selling a New Deal, but Promising It Will Be Brief

It was only 13 years ago that Bill Clinton declared before a joint session of Congress that “the era of big government is over.” President Obama’s challenge on Tuesday night is to declare that, out of ugly necessity, big government is back — and then to make a persuasive case, with a specificity he has avoided until now, that if done right, this era will not last for long.

His aides say this is no moment for the lofty idealism of the inaugural address, 35 long days and roughly a thousand Dow Jones points ago. His task is to be at once reassuring and realistic, or, as one of Mr. Obama’s economic advisers said over the weekend, “to convince the country we’ve finally pulled the ripcord on the parachute, even if we can’t tell you how long we fall or where we land.”

The hardest part will be convincing his countrymen that they cannot save themselves without first saving the banks that let greed blot out prudence, the carmakers who ignored competitive reality for a quarter-century, and the homeowners who somehow persuaded themselves that housing prices only move up.

Yet here is the paradox the president faces: The same New York Times/CBS News poll that found that Mr. Obama instills a remarkable sense of confidence — 76 percent of Americans say they think he will make the right economic decisions — also found that Americans dislike many of the choices he has made thus far.

Fifty-nine percent said that the bank bailout would help bankers far more than it would help the country. More than two-thirds had no stomach for bailing out G.M. and Chrysler, even if the alternative is liquidating the companies.

So here is a guide to what to look for in the speech to Congress, as the new president tries to emit the reassuring warble of an F.D.R. New Dealer while convincing the country he will soon fly like a deficit hawk.

The Banks: It Just Looks Like Nationalization

By the time Mr. Obama speaks, taxpayers may already own 40 percent of Citigroup. As Senator Charles Grassley, Republican of Iowa, asked yesterday in a letter to Treasury Secretary Timothy Geithner, wouldn’t that “give the government effective control of the bank, and therefore, be a de facto nationalization of the bank?”

Yes, of course it would. Fannie Mae, Freddie Mac and the insurer AIG all report to the Treasury these days. The “stress test” on major banks starts on Wednesday, and some of them could be wheeled into the operating room, where their shares will be diluted by new government holdings in common stock, as the Treasury all but said on Monday.

So in Mr. Obama’s speech, look for the code words that open the way to brief nationalization — he’ll steer clear of that term — on the way to cleaning up balance sheets and putting the banks back in private hands. Also look for any signs that Mr. Obama might decide to wipe out the current shareholders’ stakes — not that those holdings are worth very much anymore — and dump current bank managements.

His argument will probably come down to this: We’re not bailing out a bunch of clueless bankers, we’re making sure that the world’s biggest economy has a viable banking system.

A Detour to Detroit

The banks are positively popular compared with General Motors and Chrysler (which is mostly owned by a private-equity firm that says it cannot put any more of its own equity into the company). Perhaps that is because few Americans seem to believe that the companies have now seen the light, after ignoring decades of market signals.

On this subject, listen for the national security argument: That Americans cannot live without a vibrant industrial base that makes the country’s own wheels, in America. Mr. Obama’s case will be that the network of suppliers surrounding America’s auto makers cannot be destroyed. Don’t expect to hear much about the “transplants,” the subsidiaries of Japanese, German, Korean and other companies that, until the bottom fell out of the new-car market, were actually building new auto plants in the United States while the Big Three were closing old ones. Those carmakers think of themselves as American. Congress doesn’t.

The Bailout Next Door

It was a little mystifying why the White House chose, late last week, to get into a direct shouting match with Rick Santelli, a CNBC reporter and former derivatives trader whose on-air tirade against Mr. Obama’s plan to stop foreclosures went viral on the Web. “The government is promoting bad behavior,” Mr. Santelli said. The White House press secretary shot back that “Mr. Santelli doesn’t know what he’s talking about.”

Maybe he does, and maybe he doesn’t, but he tapped into genuine anger. Mr. Obama is likely to nod to the fact that many people who pay their mortgages are rightly upset that the government is rewarding some of those who overextended themselves. But he’ll argue that until the foreclosures stop, the downward cycle — ever more houses on the market, ever lower market values — cannot be stopped. On this point, the White House knows he has to sound more convincing than he did last week.

About Our Good Friends, the Chinese

Mr. Obama’s audience isn’t just domestic. His words will be translated into many languages, none more important than Mandarin.

As China’s leaders made clear to Secretary of State Hillary Rodham Clinton in Beijing over the weekend, the Chinese leadership needs to be persuaded that America remains a safe and liquid investment. She assured him that it was, of course, but what else could she say? The White House is acutely aware that its entire plan hinges on the willingness of other nations to keep lending to the United States, and that means he must make a convincing case that he’s seen the path out of deficits.

Americans and foreigners alike have heard that before; George W. Bush spent eight years churning out projections of how he would move the United States back toward balanced budgets. The financial responsibility summit on Monday at the White House — if you can call a four-hour meeting a “summit” — was supposed to signal that Mr. Obama has a plan of his own. But he has been a little vague about how he would square the goal with everything in the offing — or how he would address the toughest long-term problem, fixing Social Security and Medicare.

Look for any sign that he is now willing to kick those cans down the road, maybe by creating a commission to study the problem. (There have already been several, and on Monday the chairman of the House Appropriations Committee, Representative David Obey, Democrat of Wisconsin, declared that a commission would “thrill policy wonks and not get a damned thing accomplished.”)

But mostly, look for whether Mr. Obama puts together that elusive combination of inspiration and specificity that creates confidence. That’s what’s been lacking in the markets, and in the country. And until it is restored — until Americans have as much faith in the message as in the messenger — it’s going to be hard to break the cycle.